Should you sell your iPhone 7 or use it as a backup phone?
The prospect of using one of the new iPhones from the X range (X, XR, XS and XS Max) can tempt even the most restrained among us. After all, these devices are technological marvels that elevate smartphones into powerful mini computers.
However, what do you do with your existing iPhone 7? Should you sell iPhone 7? Use it as a backup phone? Or just keep in the drawer at home in case your new phone gets stolen or damaged? After all, a study conducted by IT start-up Gazelle reveals that 51% of iPhone owners just keep their phones in the closet, so you won’t exactly be the only one doing this.
However, sentiments aside, there is simply no argument here. You need to sell your phone. It is the only financially logical choice.
Depreciation rate for iPhones
The value of houses goes up over time. The value of certain red wines goes up over time. Even the value of comic books and action figures goes up over time.
However, the value of electronic devices never goes up under any circumstances. Yes, that includes smartphones. In fact, smartphones depreciate by the highest rate among all electronic devices. For iPhones, the depreciation rate is 5% a month. While it is still lower than Android phones (10%), 5% a month comes up to 60% annually. Your iPhone 7 could literally become practically worthless in just two years.
Trade in or direct sale?
Trade ins are almost always more profitable compared to selling your phone directly for cash. Mobile operators can offer higher valuations for phones during trade ins because they can generate some extra profit when you sign up for a new contract; the amount earned during the lifetime of a contract (typically two years) can more than compensate for any shortfall when subsidising customer trade ins.
However, this is predicated on them being able to sell the phone in another market. This means, your phone needs to be still relevant in secondary markets. So keeping your phone in the drawer for too long could render it obsolete before trading it in.
It is worth noting that refurbished phone is a huge industry. In 2017, revenue from the sales of refurbished phones tops $14 billion (£10.64 billion) – that’s higher than the GDP of Montenegro or the Bahamas.
This is not to say that selling your phone for cash is not lucrative. If your phone is unlocked, you can sell it for a pretty good price on online marketplaces like eBay or Amazon. The key is writing a good listing and having a phone still in good condition.